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CIBC CREATES GRANITE TRUST, WHICH WILL PROVIDE LOW-COST FINANCING TO PUBLIC SECTOR BORROWERS

 TORONTO, Nov. 16 ~CNW~ - CIBC today announced the establishment of Granite Trust, a special purpose financing vehicle that will raise low-cost funding from capital markets for borrowers in the public sector.
 Granite Trust will issue debt and use the proceeds to fund revolving and liquidating loans. The trust will have an initial capacity to finance up to $500 million in assets.
 The Ontario Wheat Producers' Marketing Board will become the first client of the trust. The board, which has been a CIBC customer since 1958, will use the funds raised to finance its purchasing and marketing activities on behalf of the province's wheat farmers.
 "This program will allow public sector bodies like the board which have credit support from the federal government to lower their cost of borrowing," said Rob Cummings, senior vice-president, Investment and Corporate bank, CIBC. "CIBC's experience in this area will enable us to arrange financing in a way that will benefit these organizations."
 The trust will lend to three general types of borrowers:
 + Any organization with full credit support from the federal government for their borrowings (e.g., Crown corporations)
 + Any organization with partial credit support from the federal government for their borrowings (e.g., federal loans to small business under the Small Business Act)
 + Any organization with a full price guarantee from the federal government on their assets (e.g., marketing boards).
 The trust will lend against receivables, inventory or other assets held by the public sector or groups enjoying the credit support of the public sector.
 The establishment of Granite Trust by CIBC follows the success of LEAF Trust, which securitizes equipment and automobile lease receivables, and RAC Trust, which securitizes short-term accounts receivables from corporations.
 "The great advantage of these programs for organizations is their ability to improve financial performance by offering alternative sources of funding," said Cummings. "For investors, these securities offer a high rate of return as well as safety of principal."
 CIBC is one of the largest banks in North America, with assets exceeding $131 billion. CIBC employs about 48,000 staff in 1,611 branches, offices, agencies and subsidiaries in Canada and 22 countries around the world.
 For further information: Rob McLeod, Media Relations (416) 980-3038
 (CM.)
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Date:Nov 16, 1992
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